With HD DVD out of the picture, Blu-Ray is pretty much synonymous with Playstation 3 during this critical consolidation phase. Standalone Blu-Ray players cost the same or close to the cost of the Sony Playstation game and media system. The overwhelming majority of the Blu-Ray market is now people with Playstations. This may remain the case forever if Playstation momentum continues and Blu-Ray players don't get a lot cheaper quickly.

The part that has me concerned is that if HD DVD is in such trouble, Blu-Ray can't be far behind. Warner Bros. cited concerns about recession as one of the primary motivations for their dropping the second format. But their decision to drop HD DVD was apparently based on HD disc sales favoring Blu-Ray over HD DVD 60% to 40%. That's not a huge difference in units given the tiny size of the market. The fact is Blu-Ray sales have been very disappointing too.

It will be interesting to gauge Warner's commitment to Blu-Ray and HD discs. The first test will be to see if they release some of their exclusive HD DVD titles like The Matrix Trilogy to Blu-Ray. (The Matrix should sell well to PS3 owners.)

I'm hearing a lot of indifference toward HD disc from the kinds of people who Sony need to be enthusiastic about the format. It's not like either Blu-Ray or its doppleganger the Playstation 3 have anything close to the market enthusiasm of the Wii or the iPhone. Throw in the fact that about 1 million early adopters have just been alienated out of the market overnight.

I don't think the Blu-Ray camp should be celebrating yet.

OOH, I definitely agree. That is why, I said, we will see what happens now. Most consumers I`m sure do not even know yet, and I`m sure the Circuit City/Best Buy salesperson will not mention it.